Insulin resistance leading to type 2 diabetes generally involve defects in insulin signaling at the postreceptor level. Activation of the PI 3'-kinase to Akt pathway plays a significant role in insulin signaling, but the events downtream of Akt are largely unknown. Recently, we identified a novel Akt substrate which binds to the insulin-responsive elements (IREs) of insulin-like growth factor binding protein-3 (IGFBP-3) and other insulin-responsive genes. The IRE-binding protein "sensitin" cDNA encodes a 120 kDa cytoplasmic protein. After adding insulin, the protein is cleaved to a 50 kDa fragment, which localizes predominantly to the nucleus and transactivates IREs. PI 3'-kinase inhibition decreases both Ser/Thr phosphorylation and proteolysis of sensitin. Based on our preliminary data, the long-term goal of our investigation is to employ the IRE of IGFBP-3 as a model system to delineate the signaling pathway by which insulin induces genomic effects through the action of a specific trans-acting factor, sensitin, that binds to the IRE. This application has the following aims: 1) To test the hypothesis that sensitin is subject to regulated phosphorylation by insulin, using 2-D phosphomapping and mass spectrometry to localize residues of sensitin phosphorylated by insulin in HepG2 cells, and the effect of phosphorylation on insulin-induced transcription assessed by mutational analysis. 2) To test the hypothesis that proteolytic cleavage of sensitin is required for transactivation of the IRE, and the corollary hypothesis that nuclear translocation of sensitin is secondary to cleavage of the protein. We will identify the cleavage sites by microsequencing, mutate the proteolytic domain to test its role in nuclear translocation and IRE transcription; and mutate the Akt phosphorylation site to determine if dephosphorylation prevents nuclear translocation or proteolysis of sensitin. 3) To determine the physiological significance of phosphorylation and proteolysis of sensitin in a rat diabetes model, we will compare the phosphorylation and proteolysis of sensitin in vitro by hepatic cytosolic extracts from diabetic, obese, and lean control rats, and determine whether sensitin mutation conferring protease- and phosphorylation-resistance increase the diabetes susceptibility of obese rats, or worsen glucose control in diabetic rats. This study may lead to better understanding of insulin-regulated gene transcription, and may provide insights into linked to the pathogenesis of type 2 diabetes mellitus.